Hedge rate risks with floater funds
Financial Express Mumbai|September 18, 2023
Such funds are best for those who want to invest for avery short term
Hedge rate risks with floater funds

SAIKAT NEOGI AS FLOATER  mitigate interest rate risks and adjust the duration based on prevailing interest rates, investors are finding them attractive. In August, when most debt-oriented schemes saw net outflows, floater funds attracted net inflows of *2,325 crore, data from Association of Mutual Funds in India show.

Floater funds invest in debt securities where coupon rate is dynamic in nature. The funds invest in a blend of floating rate and fixed-rate instruments, including government securities, corporate bonds, and money market instruments. The diversification spreads risk and potentially delivers higher risk-adjusted returns compared to bank fixed deposits.

Experts recommend such funds to those who want to invest for a short term, say, six months, as these are protected from interest rate risk. Moreover, these funds carry lower risk compared to equity instruments, making them suitable for risk-averse investors.

Adjust fund duration

هذه القصة مأخوذة من طبعة September 18, 2023 من Financial Express Mumbai.

ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.

هذه القصة مأخوذة من طبعة September 18, 2023 من Financial Express Mumbai.

ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.

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